WASHINGTON (dpa-AFX) - Silicon Labs (SLAB) said that it will acquire Sigma Designs Inc. (SIGM) for $7.05 per share in a cash transaction valued at approximately $282 million, subject to certain closing conditions. The price represents a 26 percent premium over Sigma Designs' closing price of $5.60 per share on December 6, 2017.
In addition to Z-Wave technology, Sigma Designs also provides solutions for Media Connectivity and Smart TV. Sigma Designs plans to divest or wind down its Smart TV business. In addition, Sigma Designs is in active discussions with prospective buyers to divest its Media Connectivity business. Subsequent to divestiture and restructuring actions, Silicon Labs expects the acquisition of Sigma Designs to be accretive on a non-GAAP basis.
In the event that certain closing conditions are not met, the parties have agreed that Sigma Designs would instead sell its Z-Wave business to Silicon Labs for $240 million, contingent upon approval by Sigma Designs' stockholders.
The boards of directors of both companies have approved the transaction. Silicon Labs expects the transaction to close in the first calendar quarter of 2018.
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